786216

research-article2018
NMS0010.1177/1461444818786216new media & societyMacey and Hamari

Article

new media & society

eSports, skins and loot

1­–22
© The Author(s) 2018
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DOI: 10.1177/1461444818786216
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associated with emergent

forms of gambling

Joseph Macey
Gamification Group, University of Tampere, Finland

Juho Hamari
Gamification Group, Tampere University of Technology, Finland; University of Turku, Finland; University of
Tampere, Finland

Abstract
Twenty years since the Internet transformed gambling products and services, the
convergence of online games and gambling has initiated a new means of consuming
Internet-based media. Gambling specifically connected to eSports is a significant
development, not only offering a new avenue for existing gambling products to be
inserted into gaming media but also affording several novel experiences (e.g. skins and
loot boxes). This study assesses participation rates and demographic characteristics of
eSports spectators who gamble via an international online survey (N = 582). The sample
highlighted the prevalence of young, often under-age, males in eSports-related gambling
activities. Participation in gambling, and gambling-like activities, was found to be 67%,
with rates of problematic and potentially problematic gambling in the sample being
50.34%. Finally, increased gambling is associated with increased spectating of eSports.
Although the results are not generalisable to the wider population, they suggest a
need for increased attention, from academia and regulators, regarding newly emergent
gambling behaviours in contemporary digital culture.

Corresponding author:
Joseph Macey, Faculty of Communication Sciences, University of Tampere, Tampere 33014, Finland.
Email: joseph.macey@uta.fi
2 new media & society 00(0)

Keywords
eSports, free-to-play, gambling, gamification, loot boxes, problem gambling, skins
gambling, video games

Introduction
The preceding decades have seen substantial growth in research addressing gambling,
especially in regard to Internet-based activities and new media contexts (Armstrong
et al., 2016; Lopez-Gonzalez and Griffiths, 2016). In addition to the realm of web-based
electronic commerce, new media have brought gambling into many other areas of online
life, including social media networks and electronic sports (King et al., 2014; Lopez-
Gonzalez and Griffiths, 2016; Macey and Hamari, 2018). Nowhere is this more evident
than in the convergence of online gaming and gambling made possible by the Internet,
mobile communications and networked online communities (Gainsbury et al., 2016;
King et al., 2010). This rapidly evolving environment offers consumers novel opportuni-
ties to participate in an ever-increasing range of gambling, and ‘gambling-like’ (King
et al., 2010), experiences on the Internet.
With the emergence of advanced, mobile communications, the practices of both video
gaming and gambling have been revolutionised by increased ease of access and sophis-
ticated audio-visual environments (Abarbanel, 2013; Deans et al., 2016). In addition,
novel points of convergence between gambling and new media have appeared, such as
electronic sports (eSports), free-to-play games, social network games, online practice
sites and virtual economies consisting of online possessions of players. As a result,
entirely new consumption practices are being created.
This process is not limited to games and gambling, but is part of a wider trend of
media convergence (Jenkins, 2006), and has been studied in reference to other, more
established, gambling activities such as sports betting (Lopez-Gonzalez and Griffiths,
2016). The blurring of boundaries between video games and gambling activities has led
to a range of problems regarding regulation and legislative issues (Teichert et al., 2017).
Although the consequences of this trend are yet to be fully assessed, current concerns
include the targeting of vulnerable populations through gambling-like experiences and
increased penetration of gambling using socially accepted vehicles such as sports and
video games (Lopez-Gonzalez and Griffiths, 2016). Allied to these specific concerns
are those aspects of Internet gambling which may potentially facilitate problematic
behaviour, such as increased ease of access and the continuous availability of formerly
discontinuous gambling activities (Cotte and Latour, 2009; Deans et al., 2016; Gainsbury
et al., 2012).

eSports and gambling

One of the most notable areas of media convergence today is eSports, that is, competitive
video gaming (Hamari and Sjöblom, 2017) (Table 1). eSports are rooted in the Local
Area Network (LAN) culture (Jansz and Martens, 2005; Taylor, 2012); however, it is
only with the advent of Internet Protocol Television (IPTV) and streaming technologies
Macey and Hamari 3

Table 1.  Points of convergence between gaming and gambling.

Point of convergence Description References

Free-to-play (F2P) Game mechanics which blur
games boundaries between gameplay
and gambling
Social network Gambling is integrated into
games social media platforms
Online practice sites Gambling-like experiences are
offered, but with no chance to
withdraw ‘winnings’
Virtual economy Use of virtual items linked
to player’s game accounts as
stakes in gambling activities
eSports The ‘sportification’ of video
games facilitates increased
social penetration of gambling
Hamari and Järvinen (2011) and
Hamari and Lehondivirta (2010)
Paavilainen et al. (2013)
Gainsbury et al. (2016)
Hamari and Keronen (2017), Holden
et al. (2016) and Lehdonvirta and
Castronova (2014)
Lopez-Gonzalez and Griffiths (2016)
and Macey and Hamari (2018)

that they have begun to make the transition from niche culture to international phenom-
enon (Hamari and Sjöblom, 2017; Scholz, 2011). As eSports has grown, a range of
related gambling activities has emerged, facilitated by the use of real currencies, virtual
currencies and a range of virtual items. These issues are discussed below and summa-
rised in Tables 2 and 3.

Betting.  There are many forms of betting associated with eSports, the majority of which
are direct analogues of pre-existing practices, for example, sportsbook betting (Gains-
bury et al., 2017a) and fantasy eSports (Tsai, 2015). Similarly, there is evidence of infor-
mal betting such as between friends and eSports players, with the latter having
implications for the integrity of the eSports scene as a whole in regard to player conduct
and potential match-fixing (Brickell, 2017; Holden and Ehrlich, 2017). However, the
digital nature of eSports has allowed the development of formalised Player-versus-Player
(PvP) betting, where players can bet on their own performance when playing a video
game (Grove, 2016; Holden et al., 2016).

Casino games/themed games.  Almost all forms of casino games (roulette, blackjack, etc.)
and simulated slots are available and are often themed according to popular eSports
games, most notably ‘Counter Strike: Global Offensive’ (CS:GO). In addition, themed
versions of simulated coin-flipping and ‘rock, paper, scissors’, among others, are also
available (Gainsbury et al., 2017a; Martinelli, 2017).

Loot boxes.  In many contemporary games, players can choose to make small payments in
order to open loot boxes (also called crates, cases, chests and other similar terms), which
are received either as random drops or as rewards for in-game achievements. These pay-
ments are primarily facilitated using real-world currency, but some games also provide
‘free’ loot boxes which can be opened using in-game currency or as rewards for in-game
4 new media & society 00(0)

Table 2.  Forms of currency used to access gambling activities associated with eSports.

Type Sub-type Description Example

Real-world – Standard payment options made US$, GBP, EUR,
currency (RWC) using credit cards or services etc.
such as PayPal
Digital/Crypto- – Payments made using client’s Bitcoin
currency (DCC) digital ‘wallet’
Site-specific Transferable Payments are converted into HEROcoin
currency (SSC) currencies which can only be (Herosphere.gg/
used on the specific site, can Firstblood.io)
be cashed out (exchanged for
RWC/DCC, etc.)
  Non-transferable Payments are converted into Unikoins
currencies which can only be (Unikrn.com)
used on the specific site, cannot
be cashed out (exchanged for
RWC/DCC, etc.)
In-game currency Soft Earned through gameplay, non- ‘Blue Essence’,
(IGC) transferable from ‘League of
Legends’
Hard/Premium, Purchased using RWC, can ‘FIFA Coins’,
transferable be exchanged for RWC via from ‘FIFA
marketplace or third-party sites Ultimate Team’
Hard/Premium, Purchased using RWC, exchange ‘Riot Points’,
non-transferable for RWC is prohibited by EULA from ‘League of
Legends’
Virtual items (VI) Transferable Earned or purchased (RWC, Skins from
DCC, IGC), can be exchanged ‘Counter-
for RWC via marketplace or Strike: Global
third-party sites Offensive’
Non-transferable Earned or purchased (RWC, Skins from
DCC, IGC), exchange for RWC ‘Overwatch’
is prohibited by EULA

EULA: end-user licence agreement; GBP: British Pounds (£); EUR: Euros (€).

efforts. Those games that do provide payment-free loot boxes also provide the opportu-
nity for players to purchase further loot boxes with real-world currency. Loot boxes
contain virtual items which may affect gameplay or may be entirely decorative. The
contents of loot boxes are randomly determined (Baglin, 2017) and the total value of the
items may, or may not, exceed the price paid to open the case; a real-world analogue are
lottery scratch cards. In addition, some loot boxes constitute part of a closed in-game
economy, where there is no direct means of exchanging loot boxes, or associated virtual
items, for real-world currency. Other games, however, do allow loot boxes and associ-
ated virtual items to be directly exchanged for real-world currency, through in-game
marketplaces, third-party services or a combination of both.
Macey and Hamari 5

Table 3.  Gambling activities associated with eSports.

Activity Activity Non–video game Stakes accepted

providers analogue (see Table 2)
Primary Secondary
descriptor descriptor
Betting Sportsbook Reg., unreg.
Traditional sportsbook RWC, DCC,
  Fantasy sports Reg., unreg.
Traditional fantasy IGC, SSC, VI
sports
  PvP Unreg. Informal betting
Casino/Themed Roulette, blackjack, Unreg., in-game Traditional casino RWC, DCC,
games etc. games IGC, SSC, VI
  Dice, coin-flipping Unreg., in-game Traditional dice games
or tossing of a coin
  ‘Rock, Paper, Unreg. Traditional forms of
Scissors’, both digital and non-
‘Minesweeper’ digital games
Loot boxes In-game In-game Lottery scratch card RWC, DCC,
IGC
  Third-party case Unreg. Lottery scratch card RWC, DCC, VI
opening sites
Skins and other As stakes in Unreg. Use of money/casino VI
VI established activities chips
(e.g. betting, casino
games.)
  Skins lotteries Unreg. Sweepstake/Jackpot
lottery
  Crash betting Unreg. n/a

Unreg.: unregulated third-party operators; Reg.: regulated third-party operators; RWC: real-world cur-
rency; DCC: digital/crypto currency; SSC: site-specific currency; IGC: in-game currency; VI: virtual items.

The use of loot boxes began with free-to-play games, but has since been adopted by
the majority of genres and business models, from independent productions to those pro-
duced by major studios. In the final weeks of 2017, the implementation of loot boxes in
the game Battlefront 2 initiated a player backlash and community-driven campaign for
loot boxes to be categorised as gambling, drawing the attention of both media and regu-
lators (Macey, 2017).

Skins and virtual items. The use of virtual items in gambling related to video games
includes both those which can be exchanged for real-world currencies and those that can-
not (Table 2). Although there are numerous possibilities to gamble with virtual items, the
practice is most closely associated with a specific item: the ‘skin’ (Holden et al., 2016).
Skins are in-game items, often with a real-world monetary value, that can be either pur-
chased directly from an online market place or earned in-game by players. Skins are
obtained by opening loot boxes, and they often have no direct effect on gameplay, being
decorative items. The use of virtual goods such as skins in gambling is primarily
6 new media & society 00(0)

associated with CS:GO, but is also connected to others (Holden and Ehrlich, 2017; Mar-
tinelli, 2017).
Skins, and other virtual items, are used in gambling in two ways. The first is by
replacing real-world currency as stakes in established gambling activities, ranging from
simulated coin-flipping to playing poker (Gainsbury et al., 2014; Martinelli, 2017;
Woodford, 2013). The second way skins are used is to access newly emergent forms of
gambling, most of which cannot be directly accessed with any other form of currency.
Skins gambling, in its many varied forms, has led to a series of legal disputes which have
been well documented (Holden and Ehrlich, 2017; Martinelli, 2017).

Skins lotteries.  Skins are used as stakes in ‘lotteries’ where the higher a player’s stake (as
a percentage of the pot), the higher their chance of winning the total pot, essentially a
form of ‘jackpot’-style lottery (Grove, 2016).

Loot box/crate openings.  Emerging after the events which affected skins gambling, third-
party sites offer players the chance to open unlimited numbers of crates for a reduced fee.
As with the skins gambling websites, these sites are unregulated and have been accused
of dishonest practices (Lewis, 2017).

Crash betting.  In crash betting, players deposit skins into an account which are then con-
verted into a site-specific currency. Crash betting is essentially a game of nerve: a marker
progresses along an exponential curve where the x-axis shows time and the y-axis is the
multiplier. The aim is to achieve the highest multiplier before the game crashes; if the
player quits before the crash, their stake is multiplied by the value reached on the y-axis;
however, if the game crashes before the player quits, they lose their stake (eSports Bet-
ting Ninja, 2017).
In addition to using real-world currencies or virtual items as stakes in gambling activi-
ties, participants can also choose between the following alternative options, depending
on the individual activity and the host site/game: digital/crypto-currencies, site-specific
currencies and in-game currencies which can be either earned in-game (soft currency) or
purchased (hard/premium currency). See Table 2 for a full summary.
To date, the majority of research into eSports spectators has been conducted by mar-
ket research organisations, with academia only recently beginning to publish in the area.
Current figures presented by market researchers claim total global eSports viewers to be
in the region of 385 million, with an approximate 50-50 split between ‘occasional view-
ers’ and ‘enthusiasts’ (Newzoo, 2017).
According to existing figures, eSports spectators have been found to be predomi-
nantly young males, more likely to be in full-time employment and to earn more than
non-eSports spectators (Gainsbury et al., 2017a). A large section, 40%, of eSports specta-
tors do not regularly play the games which they watch, thereby mirroring traditional
sports consumption practices (Gainsbury et al., 2017a).
Due to the prevalence of unregulated gambling sites and the continued state of flux,
gambling with skins and other virtual items is hard to quantify. However, in 2016, a total
of 6.5 million consumers were estimated to have wagered in excess of US$5.5bn on
Macey and Hamari 7

eSports-related gambling, of which US$649m was on sportsbook, PvP and fantasy sports
betting (Grove, 2016).
Similar to eSports spectators, a previous study found that the majority of eSports bet-
tors were young males with high levels of educational achievement; furthermore, they
were likely to be more highly engaged with gambling than traditional sports bettors
(Gainsbury et al., 2017a).

Legal context
The practice of gambling is governed by local laws and regulations which can vary
widely between, and sometimes even within, countries. For example, in the United
States, online sports betting remains illegal in the majority of states, but is, however,
legal in Nevada, New Jersey and Delaware. Gambling related to video games has been
subject to increased scrutiny in recent times, most notably in relation to the use of virtual
items such as skins and the use of loot boxes. In the latter part of 2016 Valve, the pub-
lisher of CS:GO was the subject of legal proceedings in the United States which related
to the use of skins in third-party gambling websites (Holden and Ehrlich, 2017; Martinelli,
2017). The outcomes of these cases are notable as the rulings have (a) begun to normalise
the activities associated with eSports gambling (Canfield, 2017) and (b) established that
US law does not recognise virtual items as constituting items of value, in contrast to
other countries such as the United Kingdom (Holden and Ehrlich, 2017).
Regulatory interpretations in the West are centred around a definition of gambling in
which virtual items are deemed not to possess value outside of the game from which they
originate. As such, activities which utilise virtual items are not considered gambling in
law.1 This position is one which has been questioned, both in relation to loot boxes
(Baglin, 2017; Griffiths, 2018) and other gambling-like experiences associated with
games (Gainsbury et al., 2014, 2016; King et al., 2014).
The UK Gambling Act 2005 defines ‘gambling’ as (a) gaming, (b) betting or (c) play-
ing a lottery; in turn, ‘gaming’ is defined as ‘playing a game of chance for a prize’, where
‘prize’ ‘means money or money’s worth’. The prize does not require the return of the
original stake when applied to gaming machines (Gambling Act, 2005). By this defini-
tion, any purchase of a key to open loot boxes constitutes gambling in the same way as
playing an electronic gaming machine. Griffiths (2018) highlights the fact that this is
acknowledged by the Gambling Commission in a recent position paper, yet the Gambling
Commission maintains that loot boxes are not gambling as they cannot be exchanged
outside the game. This is, however, incorrect as numerous services exist that allow play-
ers to exchange virtual game items for real-world currency, services provided by both
game developers such as Valve or third parties.2 Games such as Overwatch, which do not
facilitate player to player transfers, reimburse players with in-game currency which can
be used to purchase items from the game store. Furthermore, online auction sites exist
where players can sell their game accounts, and the accrued virtual items, for real-world
currency. As such, ‘skin-farming’ is facilitated in the same way as the more established
practice of ‘gold-farming’ (Heeks, 2009).
A final point which adds a further layer of complexity to the debate is that many con-
temporary video games require users to accept an end-user license agreement (EULA)
8 new media & society 00(0)

which defines in-game items as not having real-world monetary value. However, recent
legal judgements by the Netherlands Gaming Authority (see Note 2) and the Washington
State Gambling Commission (Songer, 2018) have declared that using virtual, in-game,
items for gambling is equivalent to using a real-world currency. This is just one example of
the larger debate surrounding ownership of digital content and intellectual property rights
associated with video games (Giddings and Harvey, 2018; Joseph, 2018; Prax, 2012).
The authors contend that the gambling-like activity of paying to open loot boxes mer-
its inclusion in this research, alongside other forms of gambling facilitated by virtual
items, notwithstanding the legal grey area which currently exists. Due to the lack of
consensus surrounding the categorisation of paid loot box opening, this work will refer
to it as a ‘gambling-like experience’ and to participants as ‘loot box purchasers’.

The present study

The rapid rise of eSports and video game–related gambling, allied with concerns
around the nature of Internet gambling and the practices evident in media conver-
gence, means that urgent study is required. This study aims to provide an overview of
a newly emergent behaviour in its relative infancy, thereby laying the groundwork for
further studies. Furthermore, it is intended to form one of the first assessments of
participation rates and the prevalence of problematic gambling behaviours from an
academic perspective.
With these issues in mind, the following research questions guided this study:

•• RQ1. What are the demographic characteristics of eSports spectators who

gamble?
•• RQ2. To what degree are spectators of eSports participating in gambling activities,
either traditional (land-based or Internet-based) or related to video games, and
which specific activities are favoured?
•• RQ3. What are the rates of problematic gambling behaviour in the population of
eSports spectators, and how do these rates compare to those who participate in
established forms of gambling?

Existing research has highlighted that both video gaming and gambling, at a high
level of involvement, are activities dominated by males (Forrest et al., 2016; McCormack
et al., 2014). Compared to land-based gamblers, online gamblers have been found to be
younger, more often male, more frequent gamblers, to spend more money gambling, to
be involved in more forms of gambling and more likely to meet criteria for problem
gambling behaviour (Blaszczynski et al., 2016; Edgren et al., 2017; Goldstein et al.,
2016). Online gamblers have also been found to have attained higher levels of educa-
tional achievement, to be employed in full-time work and to have a higher average
income than offline gamblers (Blaszczynski et al., 2016).
Given that eSports and video game–related gambling are almost exclusively facili-
tated online, video game–related gamblers are likely to share much of the same charac-
teristics as online gamblers. Therefore, it is hypothesised that those who both watch
eSports, and participate in different forms of gambling or purchase loot boxes, will
Macey and Hamari 9

predominantly be young males, in full-time employment and to report higher than aver-
age levels of income (H1).
Loot boxes are a mechanic prevalent in all types and genres of contemporary video
games, and the virtual items obtained from opening loot boxes are used as stakes in a huge
range of gambling activities (Gainsbury et al., 2017a; Martinelli, 2017). Therefore, it is
hypothesised that eSports spectators who participate in gambling, and gambling-like,
activities are likely to participate in a range of activities, accessed via mixed channels
(H2a), with betting, purchasing loot boxes, participating in skins lotteries and using virtual
items to play casino games expected to be the most popular individual activities (H2b).
For eSports spectators who gamble, or participate in gambling-like experiences, rates
of problematic gambling are expected to mirror those found in online gamblers
(Gainsbury et al., 2017b) and, therefore, will be higher in this population than other
populations (H3).
It is expected that the results of this work will contribute to identifying and under-
standing the profile of eSports spectators who gamble or participate in gambling-like
experiences, a pressing issue in light of the rapid growth of this population. In addition,
by examining the interactions between watching video games, eSports and gambling
services, this research hopes to shed light on behaviours which are associated with the
development of problematic gambling. The approach of the research is exploratory and
atheoretical; the aim is to provide descriptive information regarding those who partici-
pate in gambling related to eSports and video games.

Methods
Procedure
A link to an online survey was posted on social media sites, such as Facebook and Reddit,
on eSports discussion forums and on the social media pages of various national eSports
associations. The link was introduced with text explaining the aims of the research, who
was conducting and funding the research, and eligibility criteria. Potential respondents
were eligible to participate if they had played video games and had watched eSports,
gambled or purchased loot boxes within the preceding 12 months. Those respondents
who reported opening loot boxes, but not purchasing them, were not categorised as loot
box purchasers and, as such, were excluded from the analysis.
The survey was only available in English, as was the accompanying text, and was
published on English-language sites. As an incentive to participate, respondents had the
chance to enter a raffle to win a US$50 gift card.
The decision to collect data via an online survey was made having examined the char-
acteristics of both the target population and the topic. Online surveys have the benefit of
being a far more effective and cost-efficient method for reaching digitally engaged indi-
viduals, such as eSports fans, than the established techniques of probability sampling –
an issue acknowledged by established researchers in the field (Forrest et al., 2016;
Griffiths, 2010). Furthermore, the anonymising effect of online methodologies has been
shown to increase veracity of responses, particularly in regard to sensitive issues such as
gambling (Griffiths, 2010).
10 new media & society 00(0)

A total of 2397 responses were recorded, of which 891 were fully completed. The
number of people viewing the link but not participating cannot be ascertained. The sur-
vey included a filter question; those who failed the filter were removed from the sample,
as were those who reported neither watching eSports nor participating in any form of
gambling in the preceding 12 months. The final sample consisted of 582 responses,
24.28% of total responses received.
The survey included items which recorded demographic characteristics of respond-
ents, viewing habits for eSports and gambling behaviour, both in established contexts
(online and offline) and those related to eSports, including the gambling-like activity of
purchasing loot boxes. For all items relating to individual gambling behaviours, a full list
of activities accompanied the item. Respondents were asked to include all types of gam-
bling or gambling-like activity, whether formal (with a licensed company), informal
(between friends), legal or illicit (with unlicensed or unregulated third parties).
In an attempt to mitigate potential fatigue for respondents, while ensuring all types of
gambling were represented, gambling activities were grouped according to structural
characteristics. A full list of items is shown in Supplementary Appendix A. For all activi-
ties, items recorded frequency of participation, average weekly hours spent on activity
and average monthly spend.
Analysis was conducted using SPSS version 24; all tests are two-tailed.

Measurement
Consumption habits.  Since the advent of Internet-based gambling, it has been common
practice to distinguish between traditional offline activities and online ones (Deans et al.,
2016; Gainsbury et al., 2012). Gambling related to video games is a particular focus of
this study, despite the fact that it is facilitated almost exclusively via the Internet; it was
decided that it would constitute a separate category due to the specific context and activi-
ties of which it is comprised.
For each individual activity, participants were asked to indicate how often (daily,
weekly, monthly, etc.) they participated, their average weekly hours and average
monthly spend, in US$. For all questions concerning finances, a link was included
which allowed respondents to enter information in their currency of choice and obtain
an accurate conversion to US$. The same information was collected regarding their
consumption of eSports (viewing habits only); participants were not asked how often
they played eSports.
For each of the five activities (gambling in three contexts, purchasing loot boxes and
watching eSports), a construct relating to overall engagement was formulated by com-
bining the three main indicators: frequency of participation, average weekly hours and
average monthly spend. It was decided that a combined measure would prove most
effective as using a single measure, for example, frequency of participation, does not
provide a holistic picture (Macey and Hamari, 2018). Therefore, values for each of the
three measures were converted into scales, from 1 to 6, with 1 showing the lowest
involvement and 6 the highest. An average of the three scales was calculated, thereby
indicating overall engagement. For eSports engagement, the ready availability of free
content means expenditure is not as significant an indicator as either frequency or
Macey and Hamari 11

average weekly hours. Therefore, when calculating engagement, average monthly spend
was allocated a 50% weighting.

Problem gambling.  The Problem Gambling Severity Index (PGSI) is a widely used self-
assessment tool derived from the Canadian Problem Gambling Index (CPGI; Ferris and
Wynne, 2001), consisting of nine items. Possible responses to the items are ‘never’,
‘sometimes’, ‘most of the time’ and ‘almost always’ and are scored as follows: ‘never’ = 0,
‘sometimes’ = 1, ‘most of the time’ = 2 and ‘almost always’ = 3. Respondents with total
scores of 0, 1–2, 3–7 or 8 or more are categorised as ‘non-problem gamblers’, ‘low-risk
gamblers’, ‘moderate-risk gamblers’ and ‘problematic gamblers’, respectively. Cron-
bach’s alpha for the present study was α = .823.

Analysis
Consumption habits, relating to both the context of gambling and specific activities,
were cross-tabulated with eSports engagement in order to investigate potential relation-
ships. Due to low counts in several cells in each of the tables, Fisher’s exact test was used
in place of Pearson’s chi-squared test; in addition, Somers’ delta (Δ) and Kendall’s tau (τ)
were performed to ascertain predictive power (Δ) and direction of association (τ).
Somers’ delta is an asymmetric test; as such, eSports engagement was used as the inde-
pendent variable. All tables were square; as such, Kendall’s tau-b was reported, with
τ < 0.1 showing a weak relationship, 0.1 < τ < 0.2 a moderate relationship, 0.2 < τ < 0.3 a
moderately strong relationship and 0.3 < τ < 1 a strong relationship (Pollock, 2011).

Results
Demographics
As shown in Table 4, the final sample skews male (91.9%) and young, with 27% being
under 18 years of age, and a further 31.3% being in the age range 18–21. The youthful
nature of the sample is also reflected in the educational level and current employment
status of respondents. The most common nationality recorded was American, 35.6%,
followed by British, 7.9%, Finnish, 7%, and Canadian, 6.7%; in total, responses were
provided by 61 different nationalities.

Gambling habits
A total of 51% of respondents reported both spectating eSports and gambling within the
preceding 12 months; this figure rises to 67.18% when including the gambling-like expe-
rience of purchasing loot boxes. A further 7.4% reported gambling but not watching any
eSports, rising to 8.25%, including the purchase of loot boxes. The remaining 24.57%
reported watching eSports, but not gambling in the previous 12 months. Among those
who had gambled, there was a clear preference for using multiple channels to access
gambling content, with 57.6% using two or more channels compared to 42.4% using
only a single channel (i.e. offline only, online only or video game–related only). With the
12 new media & society 00(0)

Table 4.  Descriptive statistics of sample.

Descriptive statistics

  n %
Information not provided 11 1.9
Age
14 or under 11 1.9
15–17 146 25.1
18–21 182 31.3
22–25 96 16.5
26–29 69 11.9
30–33 31 5.3
34–37 12 2.1
38–41 11 1.9
42–45 10 1.7
46–49 2 0.3
50 or over 1 0.2
Gender
Male 535 91.9
Female 32 5.5
Other/Non-binary 4 0.7
Employment status
Employed part-time 51 8.8
Employed full-time 147 25.3
Student 324 55.7
Unemployed 49 8.4
Nationality
American 207 35.57
Australian 18 3.09
British 46 7.9
Canadian 39 6.7
Finnish 41 7.04
German 27 4.64
Others 193 33.16

inclusion of loot box purchases, the divide is even more pronounced: 61.6% using mul-
tiple channels to access gambling and gambling-like experiences, in comparison with
38.4% accessing gambling or gambling-like content via a single channel.
The most popular of all individual gambling activities was video game–related betting,
with 19.8% of respondents having reported participating within the preceding 12 months
(Table 5). This was followed by: online betting (26.8%), offline lottery (22.9%) and offline
betting (17.9%). When considering loot box purchases alongside established gambling
activities, a similar picture emerges, with the exception that the most popular activity is
now loot box purchasing, with 42.6% of those who participate in gambling or gambling-
like experiences having reported paying to open loot boxes (Table 5).
Macey and Hamari 13

Table 5.  Frequency of gambling activities in the preceding 12 months.

Participation in individual gambling activitiesa

  n % %

  (gamblers (gamblers + loot box

n = 340) purchasers n = 383)
Offline Lottery 78 22.9 20.4
Betting 61 17.9 15.9
Casino games 13 3.8 3.4
Electronic gaming machines 17 5 4.4
Card games (not poker) 38 11.2 9.9
Poker 50 14.7 13.1
Dice 12 3.5 3.1
Online Lottery 20 5.9 5.2
Betting 91 26.8 23.8
Casino games 26 7.6 6.8
Electronic gaming machines 5 1.5 1.3
Card games (not poker) 17 5 4.4
Poker 27 7.9 7
Dice 7 2.1 1.8
Video Skins lottery 47 13.8 12.3
game– Betting 115 33.8 30
related Fantasy eSports 14 4.1 3.7
PvP betting 9 2.6 2.3
Casino games using skins 23 6.8 6
Card games using skins (not poker) 4 1.2 1
Poker using skins 4 1.2 1
  Loot box purchasingb 177 – 46.2
aActivities are not mutually exclusive; percentages have been calculated using the total number of gamblers.
bPurchasing loot boxes has been separated from established forms of gambling due to its debated status.

Investigating levels of engagement with gambling, and purchasing loot boxes, in

respect to level of engagement with eSports (Supplementary Appendix B) shows clear
evidence of strong associations across all four contexts, offline (p < .001), online
(p = .007), video game–related (p < .001) and loot box purchasing (p = .039). However,
only online (Δ = .077, τ = .073, p = .049) and video game–related (Δ = .240, τ = .219,
p < .001) show clear monotonic relationships, which are moderate and moderately strong,
respectively. We can see, therefore, that increased spectating of eSports is associated
with increased levels of gambling both online and directly related to video games.
Considering individual gambling activities related to eSports engagement reveals a
number of statistically significant relationships. In the offline context, average weekly
hours spent betting, playing Electronic Gambling Machines (EGMs) and playing lotter-
ies are associated with eSports engagement (p = .037, p = .004 and p = .004, respectively).
However, it is only the first two which show clear relationships of moderate strength.
14 new media & society 00(0)

Offline betting has a positive correlation (Δ = .181, τ = .136, p = .003), while playing the
lottery has a negative correlation (Δ = –.393, τ = –.088, p = .004). Average monthly spend
on offline EGMs also shows a clear association with eSports engagement (p = .010), but
once again the exact nature of this relationship is unclear from the data.
Examining online gambling activities shows that average weekly hours spent playing
dice games has a statistically significant relationship to eSports engagement, with a p
value of .030 although, potentially as a result of the small number of cases, the exact
relationship is unclear. In addition, average weekly hours spent in online betting shows a
clear, positive relationship of moderate strength, with eSports engagement (p = .014;
Δ = .225, τ = .183, p = .001).
Unsurprisingly, it is in the context of video games where the strongest associations
between gambling/gambling-like experiences and eSports engagement exist. The most
notable relationships are in respect to video game–related betting, with both average
weekly hours and average monthly spend displaying strong positive associations
(p < .001; Δ = .399, τ = 0.3, p < .001) and (p < .001; Δ = .343, τ = .245, p < .001), respec-
tively. An unexpected finding was that both average weekly hours and average monthly
spend for purchasing loot boxes have significant, negative relationships of moderate
strength, with eSports engagement (p < .001; Δ = –.180, τ = –.131, p = .002) and (p < .001;
Δ = –.149, τ = –.148, p = .002), respectively.
Examining the specific channels used to access gambling, and gambling-like experi-
ences, provides few meaningful results as, due to the number of contexts examined in
this work, many categories are small. For example, 15 respondents reported gambling
online only. In total, there were 15 specific categories ranging in size from n = 8 to n = 68
(see Supplementary Appendix C).
We can, however, infer certain patterns from the breakdown of channels used to
access gambling. Online and VG gambling are usually accessed alongside other gam-
bling channels. We can see this by comparing online only (n = 15) and VG gambling only
(n = 21) to online and others (n = 118) and VG and others (n = 107), an eightfold and
fivefold increase, respectively.

Loot box purchasers

Of the total respondents, 13 reported opening loot boxes but not paying to do so; as such,
they were excluded from analysis. However, of these 13, 3 reported using the skins
obtained via loot box opening in other gambling activities such as skins lotteries and
stakes for playing poker. Similarly, 121 (of 177) respondents who reported opening
crates also reported using skins to gamble.

Problem gambling assessment

Rates of problematic gambling behaviour in the sample appear substantial, with those
classified as either being problematic gamblers or at moderate or low risk of developing
problematic behaviour totalling 50.3% of the sample, with rates of 4.5%, 18% and
27.8%, respectively (Supplementary Appendix C).
Macey and Hamari 15

As above, the ability to examine problematic gambling in regard to specific channels

used to access gambling, and gambling-like, content is restricted due to small group
sizes. However, we can see that rates of problematic and potentially problematic gam-
bling correlate with the number of channels used to access gambling content: for those
who use a single channel to access gambling content, rates of problematic and potentially
problematic gambling total 44.2%, compared to rates of 81.7% and 83% for users of two
and three channels, respectively (Supplementary Appendix E). As can be expected, the
majority of respondents fall into ‘low-risk’ and ‘moderate-risk’ categories, with 2.9% of
single-channel users and 2.4% of two-channel users being rated as ‘problem gamblers’.
For those who use all three channels (offline, online and video game–related) to access
gambling, the number of ‘problem gamblers’ rises to 17%.
Assessing PGSI in respect to the level of engagement with different channels used to
participate in gambling, or gambling-like experiences (Supplementary Appendix D),
reveals statistically significant associations across all contexts, whether offline, online,
video game–related gambling or purchasing loot boxes with p values of <.001 for all. All
relationships are positive, with both online and video game–related gambling being sig-
nificantly stronger than offline gambling and loot box purchasing (Δ = .437, τ = .402,
p < .001), (Δ = .479, τ = .424, p < .001), (Δ = .208, τ = .188, p < .001) and (Δ = .213, τ = .172,
p < .001), respectively.

Discussion
Investigating relationships between the online spectating of eSports and gambling prod-
ucts reveals that as engagement with eSports grows, so too does engagement in both the
range of gambling activities and the range of channels through which gambling services
are accessed. Furthermore, the rates of problematic and potentially problematic gam-
bling behaviour observed in the sample were high (50.34%).
The predominance of males in the sample (Table 4) supports H1; at first sight, this
seems to be a heavily skewed distribution. However, it echoes results from several other
studies who report rates of 85% for engaged eSports fans in the United States (Statista,
2017), attendees at LAN events (Jansz and Martens, 2005) and for video game stream
consumers (Sjöblom et al., 2017). Furthermore, rates of around 93% for Internet gam-
blers have been reported (Gainsbury et al., 2012, 2015), although characteristics can vary
according to country and gambling activity (Wood and Williams, 2011).
Similarly, the fact that the sample features a high number of adolescents and young
adults (Table 4) further supports H1, although the skew is stronger than anticipated, and
highlights the consumption of video game–related gambling by those who are legally
under-age. However, the skew towards youth means that specific elements of H1 (employ-
ment status and income) were not realised. This can be explained by the fact that the high
numbers of respondents still in full-time education have not yet had the opportunity to
establish a career for themselves.
eSports spectators were found to access gambling services in a number of different
ways, with higher rates of eSports engagement correlating with increased number of
channels used to access gambling (Supplementary Appendix F). Furthermore, video
game–related gambling and online gambling were relatively unpopular means to access
16 new media & society 00(0)

gambling in isolation, but significant numbers of respondents combined them with other
channels. Together, these findings support H2a. This is in line with previous research
which highlights the need for caution when talking of gambling channels as being mutu-
ally exclusive (Wardle and Griffiths, 2011).
A further point of interest is that the three least popular contexts were found to be
online only, offline and online, and offline and video game–related. These results demon-
strate that traditional, land-based gambling is not as popular a means of accessing gam-
bling activities for viewers of eSports as new media channels. Taken together, these
findings are a clear demonstration of the connections between video game–related gam-
bling, the purchase of loot boxes and online gambling.
Finally, those spectators who are highly engaged in eSports participate in gambling,
and gambling-like, activities at a higher rate (74.6%) than those who have either low
(64.3%) or moderate (59.8%) levels of engagement. This lends weight to the findings of
previous research which note correlations between eSports consumption and increased
gambling activity (Macey and Hamari, 2018).
In respect to individual activities, purchasing loot boxes and video game–related bet-
ting were the two most popular, with participation rates of 46.2% and 30%, respectively
(Table 5). As such, H2b is partially supported.
Considering the popularity of loot box opening, it is interesting that both average
weekly hours and average monthly spend for this activity show negative associations, of
moderate strength, with eSports engagement. It is possible that those who are heavily
engaged with eSports view the opening of cases negatively, due to their associations with
less desirable aspects of the eSports community (Lewis, 2017).
Although the number of respondents who reported not paying to open loot boxes was
small, a significant percentage (30.8%) were found to use the skins to facilitate gambling
activities. For those who did pay to open loot boxes, the percentage who then used skins
as wagers for gambling more than doubled (68.4%). Loot boxes are the primary source
by which skins are obtained, and this is evidence of a strong relationship between loot
box opening (paid and unpaid) and gambling, thereby highlighting the complicated
nature of gambling related to video games and the need to establish clear terms of refer-
ence in regard to the use of virtual items.
Betting accounts for three of the top five most popular gambling/gambling-like
activities (Table 5), providing evidence that it is a significant activity for spectators of
eSports. These findings support previous work which has found associations between
the consumption of video games and a preference for games of skill (Forrest et al.,
2016).
Finally, the expectation that using skins and other virtual items would be a popular
way to access casino games (H2b) was not realised. The low levels of participation in
skins lotteries, and in the use of skins to access online casino games (Table 5), may be
accounted for by the fact that the data were collected shortly after the events of late
2016 which questioned common practices in the skins-betting ecosystem (Holden and
Ehrlich, 2017).
Analysis of gambling engagement in respect to eSports engagement (Supplementary
Appendix B) shows clear and meaningful evidence that increased eSports spectating is
associated with increased participation in gambling activities related to video games.
Macey and Hamari 17

The findings of this research support H3 as rates of problematic and potentially prob-
lematic gambling were found to be substantial, with a combined rate of over 50%
(Supplementary Appendix C). These results echo previous research, which has found
higher rates of problematic gambling in Internet gamblers when compared to offline
gamblers (Gainsbury et al., 2014; Wood and Williams, 2011) and for those who partici-
pate in sports betting (Hing et al., 2016). However, the degree of problematic gambling
evident in this sample was unanticipated and as such requires additional scrutiny. Further
study is required in order to ascertain whether it is a characteristic of the gathered sample
or whether the PGSI is the most suitable measure for this type of behaviour.
Less than 50% of single channel gamblers were classified being problematic or poten-
tially problematic gamblers, compared to over 80% of those who gambled across all
channels, whether considering only established gambling activities or, additionally, the
purchasing of loot boxes (Supplementary Appendix C). While causality cannot be deter-
mined, it seems that those who utilise more channels to participate in gambling are more
likely to display problematic gambling behaviours. This finding is in line with previous
research (Blaszczynski et al., 2016).

Limitations
The most significant limitation of this research is the use of an online survey to collect
data; as such, it is open to the standard criticisms including that respondents were self-
selected, that the findings lack generalisability and that certain behaviours may be
over- or under-represented. In addition, the characteristics of social media platforms
used to gather data may have influenced the sample. As such, the rates of problematic
and potentially problematic gambling are potentially biased by both the nature of the
sample selection and non-representative nature of the sample, potentially resulting in
an inaccurate estimate of the true rates in the population of interest as a whole. The
findings of this work, therefore, are indicative of the current situation, and further
work is required which utilises alternative sampling methods in order to produce gen-
eralisable findings.
The potential problems of the data-gathering method are, however, mitigated by sev-
eral factors. First, the sample is not small (n = 582), meaning that intentionally mislead-
ing responses are likely to be minimised. Second, that social media platforms, such as
reddit, have been found to be as reliable sources for collecting data as either paid recruit-
ment or using university students, which are themselves popular means of collecting data
(Jamnik and Lane, 2017). Finally, it is not only online surveys to which the aforemen-
tioned criticisms can be applied; according to Griffiths (2010); using online surveys to
collect data has a number of important advantages over other methods, most notably
access, global reach and accuracy of data collection.
This research seeks to describe a population that is heavily engaged in the digital
environment; therefore, traditional probability sampling is unlikely to generate a mean-
ingful number of responses. In addition, the anonymity provided to respondents means
that they are more likely to feel comfortable providing information about such sensitive
topics as gambling or addiction, with responses being less likely to be guided by the
desire to provide socially acceptable answers (Griffiths, 2010).
18 new media & society 00(0)

The fact that the majority of responses were from Western European and North
American countries (Table 5) may be perceived as a limitation; however, a total of 61
different nationalities, from all continents, were recorded. Such diversity brings signifi-
cant depth to the results due to the diversity of experiences and attitudes captured, mir-
roring the global reach of contemporary eSports and addressing the concerns of previous
researchers (Forrest et al., 2016).
Finally, participants were only asked about their gambling history in the 12 months
preceding the research. As such, no conclusions can be drawn as to whether the sample
consists of those who are new to gambling or whether it reflects existing gamblers who
have since become interested in eSports gambling. Although research exists which sup-
ports the latter interpretation (Gainsbury et al., 2017b), the prevalence of adolescents and
young adults in the sample would suggest their opportunities to gamble have been lim-
ited by their age. In summary, it is likely that the sample includes a mixture of those who
are existing gamblers and those who are new to gambling.

Implications and concluding remarks

A feature of the data gathered in this research was the number of young people who
reported participating in gambling connected to video games and eSports, with almost
75% aged 25 or under. Much of these activities are facilitated by virtual items and are
conducted via illicit and unregulated websites. In combination with the high rates of
problematic gambling indicated by this work, we can see that there is a pressing need for
increased attention from both regulators and scholars. The continued proliferation of
video games and eSports into mainstream culture assures us that this need will only
become more acute. Indeed, purchasing loot boxes was found to be the most popular
individual activity, demonstrating that traditional definitions of gambling require atten-
tion and possible re-negotiation in light of newly emergent practices.
This research marks the first step in identifying both the participants and the specific
practices of a newly emergent, but rapidly growing phenomenon: the convergence of gam-
bling and the consumption of video games in the form of online eSports. Accordingly, there
remains a great deal of work to be done in the area, most notably in renegotiating estab-
lished concepts of gambling in light of the contemporary online environment. Another key
task would be to conduct probability-based sampling in order to establish prevalence rates
of gambling in the eSports community which can be compared to the general population.
Other avenues of potential future work include investigating the motivations for gambling
connected to video games and eSports, comparing them with those of established gambling
activities and mapping the ecosystem in which eSports and gambling co-exist. Indeed, the
scope for future work is significant due to the novelty of this field, requiring both qualita-
tive and quantitative approaches to answer the many questions that will continue to be
raised as the phenomenon grows in both social and economic importance.

Acknowledgements
The authors wish to express their gratitude to the editors and reviewers for the fair, rigorous and
meaningful review process.
Macey and Hamari 19

Funding
The author(s) disclosed receipt of the following financial support for the research, authorship, and/
or publication of this article: This work was supported by Business Finland (5479/31/2017 and
40009/16) and participating partners, Satakunnan korkeakoulusäätiö and its collaborators, Academy
of Finland (Center of Excellence - GameCult), and the Finnish Foundation for Alcohol Studies.

Notes
1. An in-depth examination of the legal issues surrounding virtual items and loot boxes can be
found in the special issue of Gaming Law Review journal (Oct 2017) dedicated to eSports-
related gambling.
2. During the writing of this article, the Netherlands Gaming Authority issued a press release
detailing its decision that loot boxes whose prizes can be directly exchanged for real-world
currency constitute gambling. Furthermore, all loot boxes, whether paid or free, transferable
or non-transferable, ‘are similar to gambling games such as slot machines and roulette in
terms of design and mechanisms’ and have the potential to become addictive (Netherlands
Gaming Authority, 19th April, 2018): https://www.kansspelautoriteit.nl/publish/library/6/
press_release_loot_boxes_19_april_2018_-_en.pdf
In addition, the Belgian Gaming Commission also announced a judgement that any paid loot
box opening constitutes a game of chance and, therefore, that even games such as Overwatch,
where there is no possibility to directly exchange prizes for real-world currency, are in viola-
tion of their gambling laws (The Belgian Gaming Commission, 25th April, 2018).

Supplementary material
Supplementary material for this article is available online.

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Author biographies
Joseph Macey is a doctoral researcher whose research interests include problematic and potentially
problematic media consumption, cognitive biases in media users, digital economies and virtual
items. Prior to his academic career he worked in the public and private sectors and is a qualified
Project Manager. His work has been published in international journals, and presented at various
international conferences and seminars.
Juho Hamari is a professor of gamification and leads the Gamification Group across Tampere
University of Technology, University of Turku on University of Tampere. Dr. Hamari’s and his
research group’s research covers several forms of information technologies such as games and
gamification, new media and online economies. Dr. Hamari has authored several seminal empiri-
cal, theoretical and meta-analytical scholarly articles on these topics from perspective of consumer
behavior, human-computer interaction, game studies and information systems science which have
been published in a variety of prestigious venues.